Tui chief executive Fritz Joussen hailed “strong” bookings for summer 2021 especially in the UK as he revealed a loss of €3 billion for the 12 months to September today.
Joussen insisted “The market will be there” next summer and declared: “We are through the worst.”
He said: “We have better bookings and less pay outs, particularly since the vaccines were announced. People who can’t go now defer bookings.”
Tui ended up carrying 2.3 million customers through the peak summer months of July to September and more than 40,000 cruise customers after a small restart in Germany in June.
Joussen said: “When we opened a destination it was immediately full. When we opened a resort, demand was there.”
The group will operate just 20% of capacity this winter, down from the 40% previously announced, but capacity for summer 2021 will be 80% of the 2019 level.
Joussen reported: “Winter bookings are in line with our expectations, maybe slightly better. The winter programme is not beautiful but it keeps the company running.”
However, he said: “We are 50% booked for May and prices are 14% up. Demand is there. The UK, our strongest market, is 19% up for Summer 21. Winter is still restricted, but week over week we see summer is better.
“The summer trends are strong now. In six months it will be very clear. Winter will be less important.”
He added: “We generate quite a good margin particularly for our branded holidays. People have the perception summer [travel] will work.
“Next year must be a year of higher margin.”
Of the €3 billion full-year loss, Joussen said: “€800 million is not cash-relevant. It is mainly impairments. When revenue deteriorates you have to account differently.”
He hailed the additional €1.8 billion in liquidity the group reported last week, saying: “It is not debt but equity and guarantees. Not only the state but new shareholders are putting equity in and the anchor stakeholder is putting more in. We have enough wiggle room.
Joussen added: “We are running ahead of our savings target. We said we would save €300 million. Now we will achieve €400 million per year in 2023. It will make us leaner and more digital. It will make us more profitable.
“2022 will be for us a very good market, with a market that is much more consolidated.”
“We are through the worst. Not only have we saved the company, we are in the process of transforming the company. It will be leaner and much more digital, and we will be in a more consolidated market.”